Council: Why Did City Administration Pressure Law Firm To Pay Sam Malone?
Update 6/26/2016 4:21 p.m.: Council members Chris Seelbach, Yvette Simpson, and Wendell Young will hold a special council meeting on the sewer district issue Tuesday at 4 p.m..
Original Post 2:33 p.m.: Some very upset members of Cincinnati City Council are demanding answers to a question that arose from an audit of the Metropolitan Sewer District (MSD) – the question of who in City Hall threatened MSD's law firm with termination unless it paid a former city council member $55,000 for consulting work.
"It does not pass the smell test,'' Council Member Wendell Young said in a two-hour meeting of council's Rules and Audit Committee Tuesday on the MSD subcontractor.
The council members want to know exactly who in the administration threatened MSD's law firm, Bricker & Eckler, with dismissal unless they paid the subcontractor; and why they made that demand.
The subcontractor in question is Sam Malone, a Republican council member from 2003 to 2005, who operates a consulting firm called Urban Strategies and Solutions Group LLC. Questions have also been raised about exactly what work Malone did for MSD.
A deputy city solicitor, Luke Blocher, said that word came down from the city manager's office last spring saying that "something needed to be done very quickly" about having Bricker & Eckler, pay Malone $55,000 immediately.
Blocher said he did not know specifically where the pressure was coming from.
Terry Nestor, also a deputy city solicitor, told the committee that Mark Evans, a partner in Bricker & Eckler "received a communication from the city that the city would no longer engage his firm if the subcontractor (Malone) was not paid post haste."
Nestor said the reason Malone was paid "was to make a clean break in the contract Mr. Malone had with Bricker and to terminate the relationship between Mr. Malone and MSD."
Malone's relationship with MSD began in 2011, when MSD was under the direction of Tony Parrott and Milton Dohoney was city manager.
After Harry Black became city manager, Nestor said, "The new administration was concerned about the contracting relationship and the oversight from Mr. Malone's company."
"The administration wanted to terminate the contract without any payment dispute that would linger for a long period of time,'' Nestor said.
And the city's law department, Nestor said, "did not want subcontractors doing work without some supervision from the law department."
The internal audit of MSD shed little light on exactly what Malone did for MSD as a subcontractor.
After the message was delivered to the law firm, the money was sent to Bricker & Eckler overnight and the law firm cut a check to Malone for $55,000 the next day and delivered it to its West Chester office.
"This sounds rather messy to me,'' Young said. "Why would they (Bricker & Eckler) be threatened with the termination of their contract with MSD over $55,000?"
"There was a severe sense of urgency,'' Blocher said. "There was no mincing of words from the city on the way this had to be done."
David Mann, the city's vice mayor, was the one who asked the Rules and Audit Committee to look into the Malone transaction.
At Tuesday's hearing, Council member Chris Seelbach said he agreed with Young's assessment and pointed out that any two members of city council could call for a special meeting of council to hold hearings into the matter.
But Council Member Kevin Flynn, chair of the committee, said he would rather not have a special session and let the investigation work itself out in the committee.
"This is not going to end today,'' Flynn said. "I would prefer that we let this process play itself out."
The issue could be revisited when the committee returns to work in August or sooner if two or more council members call for a special council meeting.